How To Write Covered Calls - An Ongoing Real Case Study! Message Board

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Strategies & Market Trends : How To Write Covered Calls - An Ongoing Real Case Study!

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To: FR1 who wrote (9301)	12/27/1998 5:16:00 PM
From: Herm	Read Replies (1) of 14162

Hi Franz, Yes, the talk on the street by the brokerages is get ready for the internet dump and the red blood on the street. Hey, if you are lucky enough to have a giant kahuna in an internet stock don't cough up new money for margin calls! Take your profits and run. Margin is a loan and many folks will not be able to make that margin call without heavy liquidation. Those internet stocks took some 3 months to soar 300% and more. Well, they willl drop 300% in much less time than that. How about five days! Those at the bottom of the pyramid will get a big surprise when the big boys head for the exits and short against the box! What do they care! They can out last the small guys. Michael Santoli from Barron's wrote an interesting article this week called, "Manic Depression - Mood swings were wild in '98." He writes, "...when stock investors sounded alarms about global turmoil, options traders ran faster than anyone to the fallout shelters." "...the extremes exhibited by the swings in options gauges were without precedent, a situation that - at least temporary - fouled the strategic models of plenty of conditioned traders." WARNING! That VIX is once again dropping towards that -20 and the markets are making new highs including the Nasdaq. Watch out! Another profit taking correction is due soon and the flush of the toilet may include the internet stocks! It's mighty tempting! I might eventually buy a few bear trap PUTs myself. Especially, if they sell LEAPs. Have you noticed any build up in PUTs open interest?????? :-)

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